Roy Hodgson, Liverpool FC and the 25-Man Squad Rule

New Liverpool manager Roy Hodgson has made three big moves since taking over from Rafa Benitez. Key players Steven Gerrard and Fernando Torres have committed their immediate futures to the club and England international Joe Cole was brought in on a free transfer.

After an extremely disappointing 2009-10 season, which saw them finish seventh in the Premier League, Cole is arguably the only player who will be a regular first-team player to have joined Liverpool during the Summer.

Other newcomers include Milan Jovanovic, Danny Wilson, and Jonjo Shelvey. While Wilson and Shelvey are both promising talents, they are unlikely to make a major impact during the upcoming season.

The main obstacle Hodgson has faced is the lack of transfer funds available. With American owners George Gillett and Tom Hicks looking to sell the club, Hodgson has had to offload players before being able to bring new faces in.

Even this has not been easy. A potential move for Emiliano Insua fell through when he failed to reach personal terms with Fiorentina. While Javier Mascherano has been continuously linked to Benitez's new club Inter Milan, the player is currently still a red.

News in the last couple of weeks has brought some renewed optimism to fans and the end of the Gillett/Hicks era seems to be closer than ever.

A number of potential buyers are reportedly interested in buying Liverpool, including Chinese businessman Kenny Huang and Syrian Yahya Kirdi. Whoever ends up taking control of the club, it is vital that the deal is done soon so that Hodgson still has time to add to the squad before the end of the transfer window.

Even then, it may not be so easy for the ex-Fulham boss to bring in the players he wants.

The 2010-11 season sees the introduction of a new rule in the Premier League that will limit clubs to a maximum squad size of 25 players. This squad has to be named at five p.m. the day after the closing of the transfer window.

More importantly, this squad can only contain 17 foreign players. The remaining eight must be considered home-grown.

Currently, there are 16 foreign players on the books at Anfield, including Mascherano. If the Argentinian does leave the club, this would mean that Hodgson could sign a maximum of two foreign players before having to omit the likes of Damien Plessis and Sotirios Kyrgiakos.

More interestingly perhaps, Liverpool can currently only name six home-grown players in their 25 man squad. Gerrard and Cole are joined on this list by Jamie Carragher, Glen Johnson, Jay Spearing, and Stephen Darby.

This would mean that Liverpool could only name a squad of 22 players, giving Hodgson space to add more British talent.

Personally, even if money were to come into the club, I would like to see Mascherano sold and replaced by Scott Parker and Peter Crouch. This would also have included a left-back but with the re-singing of Fabio Aurelio and with Insua still being on the books, the position is no longer the worrying area it was a week ago.

No matter what happens, there are few who would argue the current Liverpool squad is sufficient to mount a proper challenge in all competitions this season. And the new squad rule adds a further hurdle for Hodgson.

So far so good for Roy, but the biggest tests are still to come.

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The 16 players I have down as being those classified as foreign are: Reina, Agger, Skrtel, Aurelio, Kyrgiakos, Kuyt, Babel, Lucas, Aquilani, Jovanovic, Torres, Cavalieri, Rodriquez, El-zhar, Mascherano, and Plessis.